Re: Why are residential construction stocks so undervalued?
Because we've had a huge run up in real estate over the past 10 or so years. Currently, inventories are high, interest rates have risen, foreclosures are up (Thanks be to ARMs) and many more people are over extended so the foreclosure rate should go higher as well. Many many new homes and condos built at the later end of the boom are sitting vacant with huge incentives being offered. Still, they arnt moving. I think it might be a long term value play but I still believe we are in for more correction.
|